As suggested by someone on my last post
"How I think the next Great Depression might start" https://greatawakening.win/p/17rSsfoV8B/heres-how-i-think-the-next-great/
I'm posting up economic news of what I've seen this week. Feel free to add anything I may have missed.
SUMMARY OF BANK DEBT:
From what I know banks currently have about:
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900 Billion in FHLB loans (mostly 1 yr loans, haven't been able to verify, good public FHLB link appreciated!) https://twitter.com/FinanceLancelot/status/1712678734300426683
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110 Billion in Federal Reserve Bank Term Lending Program Loans (1 yr loan, have verified) https://fred.stlouisfed.org/series/H41RESPPALDKNWW)
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1.2 Trillion in Brokered Deposits (borrowing money from other banks) https://archive.ph/c5CYw
Banks don't make any physically valuable thing, banks make money from lending and getting interest from other people who do make physically valuable things. So now let's look at the peoples debt...
THE PEOPLES DEBT:
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$1 trillion in credit card debt. https://fred.stlouisfed.org/series/CCLACBW027SBOG
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$1.5 Trillion in Auto Loans https://fred.stlouisfed.org/series/MVLOAS
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1.76 Trillion in Student Loan Debt https://fred.stlouisfed.org/series/SLOAS
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$19 trillion total household debt. https://fred.stlouisfed.org/series/CMDEBT/
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$3.26 Trillion in state and local government debt https://fred.stlouisfed.org/series/SLGSDODNS
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$33.6 trillion national debt. https://www.usdebtclock.org/
Deposits in Commercial Banks are decreasing. This is by far the largest and longest decrease ever since being reported in 1973 according to the St Louis Federal Reserve. Fractional Reserve Banking doesn't work the other way.
https://fred.stlouisfed.org/series/DPSACBM027NBOG
FEDERAL RESERVES BANK TERM LENDING PROGRAM LASTS 1 YEAR FROM MARCH 2023, LOANS ARE INCREASING, NOT BEING PAID OFF
Federal Reserve Emergency Bank Term Funding Program created in March after the Silicon Valley Bank Crisis ends on March 11, 2024. It is useful because it allows banks to lends Treasury Bonds at 100% initial value instead of the below 70% value the bonds are currently trading at now.
FEDERAL RESERVE - Bank Term Funding Frequently Asked Questions https://www.federalreserve.gov/financial-stability/files/bank-term-funding-program-faqs.pdf
(Pg 4/9) A5. How long will the program be in effect? Advances from the program can be requested until March 11, 2024
Another interesting point is D2 (Pg 7/9) At what rate will advance under the program be extended?
A bank taking their Treasury Bonds or collateral can hand it as collateral to the Fed for 100 cents on the dollar instead of the market price right now which may be 70 cents on the dollar or less. The Fed charges a 1 Year Overnight Index Swap (OIS) the current rate that the advance was made + 10 Basis points (+0.1%)
Current rate found here. Its 5.5% today
https://www.frbdiscountwindow.org/
Banks will only lend to other banks who give up "good quality collateral". A lot of these repo transactions are collateralized with Mortgage Backed Securities (MBS). MBS are currently the shittiest "good quality" collateral for loans.
We Need To Discuss The New Repo Market Data ASAP | Eurodollar University
https://www.youtube.com/watch?v=tiLIOfqFr5c
12:40 June 2022 Increase of MBS collateral in Tri Party Repo while decrease in Treasury Collateral reported by NY Federal Reserve. 540billion June 2022 to 818 Billion in September 2023
17:31: 📊 The usage of US Treasury collateral in GCF repo has significantly decreased while the usage of agency MBS collateral has increased, raising questions about the shift in collateral quality.
Percentage of subprime auto borrowers 60+ days past due on loans hits a% record 6.1% in September 2023.
https://twitter.com/KobeissiLetter/status/1715730939911786714
This is the highest delinquency rate of all time, even above the 6.0% peak in 1994 and 5.0% in 2008.
The return of student loan payments has added pressure to many of these borrowers.
Average student loan payments are at $500/month and the average new car payment is at $740/month.
This means just to buy a car and pay off your student loans, the average American is spending $1,240/month.
Rising wave of property defaults threatens US banks
https://www.telegraph.co.uk/business/2023/10/27/rising-wave-property-defaults-threatens-us-banks/
Vulnerable lenders are being squeezed on all sides as debt-laden commercial real estate sector succumbs to hybrid working
“Office blocks purchased with debt remain half empty, 18 months after the end of the pandemic.…
https://twitter.com/ProdigalThe3rd/status/1717929991566946644
EDIT:
ST LOUIS FEDERAL RESERVE - Delinquency Rate on Credit Card Loans, Banks Not Among the 100 Largest in Size by Assets is at 7.51% - The highest ever recorded!
https://fred.stlouisfed.org/series/DRCCLOBS
Recent Spikes in Gun Ammo Prices
All Rifle Ammo
- 5.45x39 HUGE SPIKE JUMP
- 5.56 NATO Large Spike
- 223 Rem spike up
- 7.62x39 spike up
The US federal budget deficit effectively doubled this year
https://www.morningbrew.com/daily/stories/2023/10/22/deficit
Year over year increase effectively doubled from $1 trillion in 2022 to $2 trillion in 2023.
🇺🇸 US Senator Cynthia Lummis asks the Department of Justice to criminally charge #Binance & Tether.
https://twitter.com/WatcherGuru/status/1717592886538121461
With the Japanese Yen now above 150 Yen/Dollar, this signals the end of the extremely profitable Carry Trade. Here is a thread about the Japanese Carry Trade
Part 1: $JPY Carry Trade - The Biggest Financial Ticking Time Bomb Of All?
https://twitter.com/DarioCpx/status/1691094524368404481
Part 2: the total amount outstanding lent overseas by Japanese Financial Institutions was equivalent to a mind-boggling 144,492,600,000,000 $JPY
And that's only one part of the story. The second part is called "Cross Currency Swap"...
https://twitter.com/DarioCpx/status/1717725925125812613
Dr St. Onge Weekly Economic News Report
Episode 27 of the Podcast is live! 🥳
- "Soft Landing" calls precede every Recession
- World War 3 but Stocks are Up
- Biden: We can Afford 2 Wars
- Prices up 17% under Biden
- How they sell inflation
- Just 7 stocks Holding up Entire Market
https://open.spotify.com/episode/4ycKHhaiIZWc8gYTLsoEfl?
BLOOMBERG - JP Morgan CEO Jamie Dimon Plans to Sell $141 Million Worth of JPMorgan Shares
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Disposal to be Dimon's first such stock sale since beginning his tenure as CEO starting 2005
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"Sale is for financial diversification, tax planning: filing" (he legally can't say he thinks the stock will go down, he'll get lawsuits)
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Dimon and his family currently hold about 8.6 million JPMorgan shares, meaning the planned sale would represent less than 12% of their holdings in the New York-based bank. (How much more could he sell without causing a panic?)
(Oct-24-2023) Jamie Dimon rips central banks for being ‘100% dead wrong’ on economic forecasts
“I want to point out the central banks 18 months ago were 100% dead wrong,” he added. “I would be quite cautious about what might happen next year.”
In other recent warnings, Dimon warned of a potential scenario in which the fed funds rate could eclipse 7%.
“Whether the whole curve goes up 100 basis points, I would be prepared for it,” he added. “I don’t know if it’s going to happen, but I look at what we’re seeing today, more like the ’70s, a lot of spending, a lot of this can be wasted.”
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Gold Prices at new highs since May-2023 tradindg currently at $2006 https://goldprice.org/
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Silver Prices not seeing such a jump, still trading lower than earlier this week. Right now at $23.38/oz https://www.apmex.com/silver-price https://silverprice.org/
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Crypto - Bitcoin has seen a dramatic jump in the last few weeks. Other crypto has recently folowed suit as well. Bitcoin trading right now at $33,850, up 14% from last 7 days, along with several other Cryptos. https://www.coingecko.com
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Treasury Bond Yields have been pretty flat, the market is not fleeing to Treasuries in Extreme Fear which is very different from the past. https://www.investing.com/rates-bonds/usa-government-bonds
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KRE - SPDR S&P Regional Banking ETF - Trading down 30+% Year to Date. https://finance.yahoo.com/quote/KRE
DTCC: A Protocol Activation Event has occurred. ISDA Determinations Committee: a credit event has taken place with respect to Country Garden Holdings Company Limited.
https://dismal-jellyfish.com/country-garden-event-trade-information-warehouse-protocol-activated/
Evergrande was the 2nd biggest real estate in China. Country Gardens the biggest and it is now defaulting on its debt.
Nice detailed summary. Thanks.
Thank you for reading, I hope it's helpful!
I absolutely love the idea of a weekly update. Thanks for posting!
AS a "former employee" of Merrill-Lynch and quite familiar with GS and JPM...this can ONLY mean one thing for these snakes...the end is about to crater and they want to get out from under the rubble that is coming down on them and what they caused....COULDN'T HAPPEN TO A NICER BUNCH OF MALCONTENTS!!!🧨🧨🧨🧨🧨🧨🧨🧨🧨🧨🧨
List gold silver sales
I added price change, do you know somewhere I can find overall volume of gold/silver sales?
I don't but anecdotally my local coin shop has had lines out the door for couple years
https://old.reddit.com/r/SilverDegenClub/comments/17hwkn4/pslv_buys_200000_oz_at_near_spot_price_for_the/
This guy writes a very good summary of the metal markets every trading day. I've been reading his posts for years. He was on wallstreet silver,but him and a lot of other posters moved.
Appreciate your report
Silver is still the best deal even with the outrageous premiums.
I’d say ammo is going to be more valuable than that especially for a time period.
Silver is definitely gonna give a crazy good return on investment, I don't think you can lose with it at the end of the day.
I do think there will be a bit more devaluing with paper silver price before the 2nd crash but the returns after paper silver disappears will be so enormous it's worth investing in now.
Do you think being bullish on BTC is mutually exclusive to being bullish on gold and silver?
They go hand in hand up to a certain point.
The majority of the public (especially older folks) will choose gold/silver over bitcoin until they realize how much more convenient it is and that they can have the all the positives of our modern world without the negatives of fiat.
If you read my post "this is how I think the next Great Depression might start", I think both will take a tumble during the 1st crash.
Gold/silver will have their major spike up in the 2nd crash a few months later. Crypto will possibly go up as well but not so much.
Crypto will have its major spike up when the Federal Reserve starts buying Treasury Bonds directly from the Treasury (right now Treasury bonds have to be sold first before Federal Reserve buy on the bond market) and/or introduces CBDCs. Then it'll be a battle royale of which Cryptos are the best as deemed by the public.
Thanks for the insight. I love the idea of bitcoin not so much the other cryptos.
Million dollar question when is the first crash? I thought it was going to be years ago when I got out of the stock market. But, here it is still lumbering along to a slow, painful death. Some are predicting no crash just will run parallel to crypto till the fiat finally dies.
I believe the 2nd crash will be when the Reverse Repo is wiped out sometime January-February. The Reverse Repo is what is stopping Treasury Yields from shooting up faster and where the US Treasury is dumping all their debt.
George Gammon thinks there will be a crash by March 11, 2024 when the Federal Reserves Bank Term Lending Program ends (allows banks to borrow with Treasuries as collateral at 100% their initial value and not current market value).
The first crash is uncertain. My guess was end of October-November so it may still happen in November.
There is a
The first crash i expect is gonna be wall street realizing the market is too risky and getting out. Banks will be selling stocks, gold/silver futures, and crypto to stay afloat (btw highly recommend looking at Cardano, there's more than Bitcoin out there and this one is very promising).
The time periods in speculating for the crash from FinTwit and Youtubers I've followed a few years have gone from "the crash will be a few months from now", to "a month from now", to "next week possibly next weekday".
This last Friday, you could easily argue the only thing keeping the S&P 500 up was the Amazon earnings report which drove the stock up 7%. Everything that wasn't tech (and even most of tech) is floundering or shooting lower.
98% of all gains in the s&p 500 in the last few years have been from the 13 biggest stocks right now. They are all tech and almost all on the AI craze which is centrally around Nvidia GPUs. New tech is also the thing your least likely to buy when your worried about food and having a roof over your head.
Also one other thing to think about: if money in the economy goes to treasury bonds because the treasury bond yields are so high compared to Federal Reserve base rate, there's little to no money in the economy for loans so it causes businesses to fail and the economy to crash. If the Federal Reserve keeps raising rates to be above the Treasury Bond yield, it will also crash the economy. Its a downward spiral all caused by government spending.
Didn’t catch this when posted. Thanks for posting all this. I happen to search for posts about silver and found it.
Crypto?? That's vaporware.
Michael Saylor won't say so or many other people who have gotten wealthy on BTC.